The Bank Amalgamation.

Feilding Star, Volume XVI, Issue 69, 15 September 1894, Page 2

The Bank Amalgamation.

ALLEGED TERMS oF THE AGREEMENT. Christciitjrch, Sept. 18. The following message from Wellington appeared in to day's Press, as from their special political correspon dent : — Various rumours as to the contents of the signed agreement between Mesßrs Murray and McLean for their respective banks are afloat, but I believe the following will be near the mark. The terms of agreement for the amalgamation of the banks are now stated to be that, for the purposes of account, the shares of the Colonial Bank shall be credited at par, and those of the Bank of New Zealand at a discount of 33£ per cent off par value To balance this discount ap parently £30,000 is to be paid from out of the first profits of the reconstructed Bank to the credit of the Assets Company, and that concern is to be further contingently benefited by the payment of all profits of the Bank in excess of 6 per cent for 10 years. Exoepting as to thin liability, the As sets Company will be completely separated from the Bank by statutory enactment. Power will be taken by the Bank of New Zealand to issue new shares to the Colonial Bank shareholders of a face value of 40s, which is the present par value of the Colonial shares. They will not carry any contributory liability, and the present shareholders of the Bank of New Zealand will, I undersland, be placed in a similar position as to this last condition. Both classes of shares will thus rank as paid up. The par value of the new issue of the New Zealand Bank to the present share holders will be £5 5s and £7 10s upon each class of shares respectively, less 33£ per cent., in terms of the agreement, while the new issue of New Zealand shares to be issued to the Colonial Bank shareholders will have a face value of £2 without further liability. It would thus seem that the shares are practically taken at par on either side, and the New Zealand Bank stock written down to admit of an immediate and contingent contributory assistance to the Assets Company which otherwise will be absolutely separated from the reconstructed Bank Officers dispensed with will be com pensated by the bank to which they belong.